A Study On WTO 's Export Taxation Discipline

On January 30th,2012, WTO Appellate Body released a final report on the case of "China-Measures Related to the Exportation of Various Raw Materials" (China-Raw Materials), ruling that China has violated the WTO rules for its restrictive measures (such as export duties) on 9 kinds of raw materials’exportation. The current WTO regime on export duties embodies two extremes, one extreme is that most WTO incumbent members has nearly complete freedom on levying export duties, which renders the WTO discipline on export duties does not be widely binding; the other extreme is that several WTO acceding members like China are restrained by their stringent export duty commitments in the Accession Protocols, which deprives their rights to claim a larger share of their own natural resources for domestic producers, and causes varying degrees of damage to their sovereignty, economy and environment.Export duty commitments in the Accession Protocols derive many issues:The fact that it can hardly be modified or withdrawn would challenge resource exporters’ sovereign right over natural resources, shock their domestic employment and downstream industry, and impact their environmental management. This paper seeks to analyze the issues and negative effects of current WTO discipline on export duties through China-Raw Materials; besides, it proposes ideas of reforming WTO discipline on export duties through probing into WTO discipline on import duties and the export duty commitments in the Accession Protocol of Russia; finally, it makes suggestions to China’s international strategies and domestic countermeasures to current issues in the course of reforming WTO discipline on export duties.This paper is structured with five sections as follows:Section 1 makes a brief introduction to the WTO discipline on export duties in the era of GATT and WTO respectively in general, besides, brief analysis will be made to the reasons why it lacks discipline on export duties in both eras.Section 2 points out the major issues of current WTO discipline on export duties, including 1. the differences on the rights of using export duties among WTO members will do harm to WTO legal system; 2.export duty commitments in the Accession Protocols can hardly be modified or withdrawn; and 3. export duty commitments in the Accession Protocols are not entitled to the exceptions available under the GATT for some acceding members.Section 3 probes into the impact of irrational WTO discipline on export duties, which contains the impact on resource exporters’sovereign right over natural resources, economic development and environmental protection. In addition, this section analyzes how the ruling of China-Raw Materials affects the current Chinese policy on rare earth’s export restrictions.Section 4 tries to seek reform ideas on how to remedy the defects of WTO discipline on export duties and incorporate the export duties into the GATT schedules. Specific methods are to consult WTO discipline on import duties and export duty commitments in the Accession Protocol of Russia.Section 5 makes suggestions for China on how to push forward the reform. However, on account of the difficulty and long time span for reforming, the author will makes suggestions for China on how to cope with the current issues on the aspects of legislation, economy and strategy of development as well.